The Ministry of Finance has recently publicised a draft decree on management of debts of State-owned enterprises (SOEs), which notably permits SOEs to sell their debts to a debt trading company.
If the draft comes into law, SOEs will be able to sell debts which they classify as irrecoverable to the Viet Nam Debt Trading Company at prices agreed by the two parties.
After buying debts from SOEs, the Viet Nam Debt Trading Company may reschedule debts or decide to change the applicable interest rates to suit debtors' payment capacity. It may also transfer the debts or sell the debts to another party.
Under the draft decree, leaders of SOEs would take charge for settling their enterprises' debts. In case of failing to promptly settle debts, thus causing loss to State capital, they would pay compensations from their own pockets.
In case an SOE goes bankrupt or is dissolved as the result of capital loss or insolvency which stems from the sale of debts, those who decide to sell debts would have to pay compensation and be handled according to the law and the enterprise's charter.
The draft decree also requires SOEs to develop and issue regulations on debt management, clearly defining the responsibility of each individual in monitoring, recovering and paying debts.
Within 90 days after the draft decree is promulgated, members' councils of enterprises governed by the decree would issue their internal debt management regulations.-VNS
Source: Vietnam News (Updated May, 29 2013 12:10:00)
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